Shares in Davide Campari-Milano N.V. show a positive technical chart pattern over the medium term. The timing to jump back on the rising trend seems good.
Strengths
● The company returns high margins, thereby supporting business profitability.
● The group usually releases upbeat results with huge surprise rates.
Weaknesses
● The share is close to its long-term resistance in weekly data. Therefore, the potential should be limited. However, a further bullish movement when crossing this resistance will be a positive signal.
● Technically, the stock approaches a strong medium-term resistance at EUR 9.07.
● The company is in debt and has limited leeway for investment
● The company's "enterprise value to sales" ratio is among the highest in the world.
● With an expected P/E ratio at 48.82 and 35.47 respectively for both the current and next fiscal years, the company operates with high earnings multiples.
● The firm pays small or no dividend to shareholders. For that reason, it is not a yield company.
● Revenue estimates are regularly revised downwards for the current and coming years.
● For the last twelve months, the trend in sales revisions has been clearly going down, which emphasizes downgraded expectations from the analysts.
● For the last 12 months, analysts have been regularly downgrading their EPS expectations. Analysts predict worse results for the company against their predictions a year ago.
● The appreciation potential seems limited due to the average target prices set by the analysts covering the stock.
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Davide Campari-Milano N.V. is one of the Italian's leading producers and distributors of spirits and wines. The activity is organized around three product families:
- spirits: rhums, vodkas, tequilas, whiskies, liqueurs, etc. (Campari, SKYY Vodka, Cynar, Aperol, Cabo Wabo, CampariSoda, Glen Grant, Ouzo 12, X-Rated, Dreher, Old Eight and Drury's brands);
- wines: Liebfraumilch, Cinzano, Mondoro, Riccadonna, Sella & Mosca and Teruzzi & Puthod brands;
- non-alcoholic beverages: aperitifs (Crodino brand), sodas (LemonSoda, OranSoda, PelmoSoda and TonicSoda) and mineral water (Crodo).
At the end of 2023, the group had 22 production sites worldwide.
Net sales are distributed geographically as follows: Southern Europe/Middle East/Africa (27.6%), Americas (43.9%), Northern Europe/Central Europe/Eastern Europe (20.6%) and Asia/Pacific (7.9%).